Climate high up on the agenda at Davos 2020

2020 marked the 50th annual meeting of the World Economic Forum (WEF) in Davos, Switzerland. Climate change was high on the agenda this year, with businesses taking the lead over governments setting ambitious targets to decarbonise. As the global context changes for business, and as increasingly conscious consumers demand action, now is the time for hospitality businesses to take action and reducing food waste is key to reducing the carbon footprint.

Reactions to the summit

The Guardian described this summit as ‘The Global Heating Davos’ where the penny finally dropped for many with regards to climate change. Nowhere was this seen more clearly than in the financial sector. The week prior to the event, Blackrock’s Larry Fink had written to CEOs describing a ‘Fundamental reshaping of finance.’ Finks, whose firm manages assets of nearly $7 trillions (more than double Germany’s GDP), argued that climate change has become a defining factor in companies’ long-term prospects.

Adding to his case, he further announced that Blackrock equated climate risk to investment risk and that Blackrock would be increasingly willing to vote against management who demonstrate poor sustainability performance.

2020 Global Risk Report

The 2020 Global Risk Report was launched alongside WEF. The report, which surveys over 750 global experts and decision-makers, concluded that the top five global risks in terms of likelihood were all environmental. It was the first time that responders had ranked environmental issues ahead of societal, economic, technological and geopolitical ones.

Key issues identified:

Extreme weather events with major damage to property, infrastructure and loss of human life

Failure of climate-change mitigation and adaptation by governments and businesses

Human-made environmental damage and disasters, including environmental crime, such as oil spills, and radioactive contamination

Major biodiversity loss and ecosystem collapse (terrestrial or marine) with irreversible consequences for the environment, resulting in severely depleted resources for humankind as well as industries

Major natural disasters such as earthquakes, tsunamis, volcanic eruptions, and geomagnetic storms

Advances for the climate change movement

It is within this context that businesses appear to have made faster inroads compared to governments. At Edelmans’s breakfast launch of the annual Trust Barometer, Microsoft’s president Brad Smith explained how the tech giant was taking a much more active approach through a series of climate-related announcements. The tech giant shook up the climate debate by committing to be a net negative carbon emitter by 2030 and make up for every bit of carbon it has put into the atmosphere since it was founded in 1975.

Microsoft’s announcement follows the likes of IKEA, Mars, Coca Cola and a swathe of global businesses committing to science-based targets to reduce greenhouse gasses. Targets adopted by companies to reduce greenhouse gas (GHG) emissions are considered “science-based” if they are in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement

Whilst transitioning from a fossil fuel-based economy to a low carbon economy, it is essential to keep global warming under 2C and increasingly businesses are also considering the impact circular business models (the circular economy) can have to reduce impact.

The circular economy challenges our linear approach to production (make, use and dispose of) by recovering and regenerating product materials at the end of life. At an event highlighting the importance of Circular at WEF, WBCSD CEO Peter Bakker made the point that moving to a fully circular economy would have an equivalent impact on reducing CO2 emissions, compared with a move away from fossil fuels. WBCSD estimate that less than 9% of the world’s economy is circular and that without system-level change the targets set by Sustainable Development Goals (SDGs) and Paris Climate Accord seem virtually impossible.

Davos 2020 also saw the launch of Accenture’s The Circular Economy Handbook. With the strap line ‘The Circular Advantage’, the report lays out a playbook for executives to transition from linear thinking to circular operations. Based on over 1,500 case studies (of which 300 are included in the book including Winnow), the authors argue that moving to a circular business model creates new opportunities for competitiveness and sustainable prosperity.

One such example is Philips, who is six years into their Circular Strategy. The firm has committed to close the loop on all large medical systems equipment that becomes available to us and extend circular practices to all medical equipment by 2025.

IKEA is another global player who has already committed to fully circularity. Their People & Planet strategy commits the retailer to become a fully circular business by 2030 across all 12,000+ product lines including food. IKEA has already made great in-roads eliminating food waste from their restaurants by partnering with Winnow.

It’s clear from the news coverage and social media that the conversation is moving forward with respect to climate change. WEF themselves noted that “The trends online for 2020 have slightly shifted from 2019, where gender equality and diversity emerged as key themes, but climate change, renewables and sustainability have remained a large part of the conversation, along with geopolitics.”

The hospitality and foodservice sector has an important role to play in paving a way to a more sustainable future. Early movers like IKEA have shown their hand, and it is clear that both consumers and investors are demanding system-level change. To reduce carbon footprint operators have essentially two levers: One to decarbonise their menus by transitioning towards a plant-based diet (as recommended by the EAT Foundation’s EAT Lancet report last year) and reducing food being wasted. Adopting technology to eradicate avoidable food waste from kitchens is a no-brainer reducing food purchasing costs but also carbon footprint.

Broadcasting the popular ‘Outrage & Optimism’ podcast from Davos, Christiana Figueres (Former Executive Secretary UN Climate Change Convention and architect of the Paris Climate Agreement) described 2020 as the beginning of the “Super decade for the climate. She summarised the more urgent mood in a tweet “Doing our best is no longer enough. We must all now do what is necessary.”